Arcata City Councilmembers Meredith Matthews, Sarah Schaefer, Kimberly White and Alex Stillman| Screenshot from Arcata City Council meeting video



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The City of Arcata’s budget for fiscal year 2022/23 is looking pretty tight, with the City roughly $13 million above budget on its current expenditures according to the mid-year budget review that took place during Wednesday night’s Arcata City Council meeting. 

And though that might sound like a lot of money, Tabatha Miller – finance director for the City of Arcata – wanted to stress that she was “not too worried about it” and that incoming grant funding and the City’s reserves would be able to largely make up for the $13 million shortfall. 

Miller told the council that Arcata’s expenditures have been unusually high this year (roughly $79 million), but that is because of some of the city’s larger projects underway that are mostly being covered by grant funding. For example, $9.3 million of the deficit is for the conversion of two Valley West hotels into homeless housing, as a part of Project Homekey, a sum that will be covered by grant funding that the city recently received. 

Another large expenditure this year is the city’s Wastewater Treatment Facility, but that is more than covered by the total wastewater fund revenues. Some good news for the city’s budget, Miller said, is that the revenue from wastewater rate increases is $1.1 million higher than originally estimated for the 2022/23 budget. 

Screenshot from Tabitha Millar’s presentation


Some of the changes made to the budget expenses include $30,000 for funding extreme weather shelters, $30,000 that the city is reserving for the creation of a mural honoring David Josiah Lawson, $195,000 for the Carlson Park improvements (though that money will also be covered by grant funding) and $355,000 the city is setting aside for a new city street sweeper. The revised budget also includes $193,000 in utility increases, a result of unusually high gas prices and the unusually cold winter temperatures, Miller said. 

Though city staff has been working hard to secure grant money, the city has seen a significant increase in most of its other revenue sources and Miller said that this trend will likely continue for a while. Arcata’s sales tax is down 5.7 percent (Humboldt County has seen a nearly seven percent decline) and the city is losing a significant amount of Transient Occupancy Tax (TOT) that it would usually collect from local hotels. In addition to the two hotels converted into housing for the homeless, three other Valley West hotels will be used to house returning Cal Poly Humboldt Students next semester. 

Arcata City Manager Karen Diemer said that the city has been in discussions with Cal Poly Humboldt and that the university will likely be providing the City with some funding to offset the loss from the TOT tax. Diemer added that the hotels will still be open to visitors during the summer months and that during that time, the city will be able to collect TOT as usual. 

Following the presentation and a fairly brief discussion, the council voted unanimously to approve the amended 2022/23 budget. Councilmember Stacy Atkins-Salazar was absent, having left the meeting early due to illness. Councilmember Meredith Matthews read a note that Atkins-Salazar left before her exit, which said that the council and city staff had received a request from local nonprofit Black Humboldt, asking if the City could help fund some of the group’s activities. 

This prompted Matthews to point out that the council allocated $100,000 in ARPA funds to Arcata Main Street to help fund outdoor activities, and that part of the agreement was that the organization would specifically work with local groups including Black Humboldt and Queer Humboldt.  

Matthews and Mayor Sarah Schaefer both said that they have not received any update from  Arcata Main Street on how the $100K is being spent and requested that an update from the organization be placed on a future agenda. 

The council also voted to remove any proposed improvements to council chambers from the budget and agreed that the council will need to brainstorm some additional ways to boost the city’s general fund in the future. 

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The council also took a step toward mandating citywide compost, unanimously approving amendments to a joint powers agreement with the Humboldt Waste Management Authority (HWMA) that places the agency in charge of deciding where organic waste will go after it has been collected.

The agreement is one of many steps necessary for Arcata and other parts of Humboldt to come into compliance with SB 1383, California’s Short-Lived Climate Pollutant Reduction Strategy, which requires cities to reduce the waste going into landfills, among other things. 

The HWMA agreement will need to be passed by the other involved governments (at least 70 percent will have to approve it) and then be adopted by the HWMA board or directors. After that, the Arcata City Council (and other local governments) will need to pass a resolution officially designating HWMA as the agency in charge of organic waste flow control.  

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